Grover Vineyards to sell 35% to Jerry Rao, consortium

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Aug 24, 2006, 01.12 AM IST

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NEW DELHI/BANGALORE: Grover Vineyards, one of the leading domestic wine companies, is close to offloading 35% stake to Jerry Rao and a consortium of financiers. Sources in the financial circuit say the deal is likely to be worth Rs 28-29 crore and will likely be wrapped up by mid-September.

When contacted by ET, Mr Kapil Grover of Grover Vineyards said, "There's nothing yet but we are close to wrapping up the deal." Mr Rao, the founder-chairman of MphasiS BFL and ex-Citibanker, has already struck a contract farming arrangement with the wine company for which he has bought land near Nandi Hills close Bangalore where Grover Vineyards is located.

Mr Rao turned his attention to the wine industry after the sale of MphasiS and has been buying land — he already owns about 50 acre near Nandi Hills — to supply grapes to Grover Vineyards. Mr Rao's play in Grover is likely to be a financial investment.

The promoters of Grover Vineyards are expected to offload a 35% stake in the company which includes a 17% personal stake of Mr Grover and another 18% stake of an overseas commercial body called Vishnu Holding. The company had received several expressions of interest in the run up to the sale, which began nearly two years back, which initially carried an asking price of Rs 12 crore.

The list included strategic players, financial partners and high net worth individuals. Although there is no confirmation from the company on this, sources say Mr Rao will likely work with a consortium to pick up the stake on offer.

The top three winemakers in the market — Sula, Grover and Indage — are attracting some big-ticket interest from assorted venture cap and private equity players as well as fund managers.